Insurable Interest Canadian Insurance Blog

Staff | June 30, 2020 Nova Scotia’s Public Service Superannuation Plan reported a 98.5 per cent funded status as of Dec. 31, 2019 and said it will halt cost-of-living adjustments for retirees for the next five years. According to the plan’s 2020 funded health review, its funding policy prohibits indexing when the PSSP’s funded status is below 100 per cent. However, the Public Service Superannuation Plan Trustee Inc., which oversees the fund for N.S. government, university and municipal employees, decided not to adjust contribution rates, which it’s required to consider if the plan’s funded status is above 96 per cent but below 100 per cent. Read: OMERS Sponsors Corp. approves shared-risk indexing, other plan design changes This is the second funding health review conducted by the PSSPTI since the plan’s funding policy was updated to address a 69 per cent funded status and a $1.6-billion deficit at the end of 2009. In 2015, the plan’s funded status was 104.7 per cent and the cost-of-living increase was set at 0.85 per cent per year. The trustee also allocated $125 million of the plan’s funding surplus to a strategic reserve. In a press release, Ron Smith, the PSSPTI’s board chair, acknowledged that the lack of cost-of-living adjustments would be disappointing for retirees. “The plan’s funding policy was...

Staff | June 30, 2020 The majority of U.S.-based defined contribution pension plan sponsors said they haven’t felt the need to pause or reduce contributions during the coronavirus pandemic, according to a new survey by the Defined Contribution Institutional Investment Association. While 86 per cent of respondents said they aren’t considering suspending matching employer contributions, just eight per cent said they already have. Meanwhile, 92 per cent said they aren’t considering reducing those contributions, with just three per cent saying they’ve done so. No plan sponsors said they’ve reduced or suspended non-matching employer contributions, with only a few (eight per cent and six per cent, respectively) considering either option. Read: Could coronavirus delay DC plan members’ expected retirements? A small amount (13 per cent) of plan sponsors said they’ve laid off employees as a measure to deal with the impacts of the pandemic, while the same amount said they’ve actually increased hiring in certain departments. Half (50 per cent) said they’ve implemented a company-wide hiring freeze and 38 per cent said they’ve reduced workers’ hours in specific departments. As far as plan member activity around investments, the survey also found 12 per cent of plan sponsors said they’ve observed a decrease in allocations to equity. Ten per cent saw...

Martha Porado and Kelsey Rolfe | June 30, 2020 Employers across Canada were forced to adjust their Pride celebrations in June as the coronavirus pandemic necessitated social distancing and most traditional parades and events were cancelled. “[The coronavirus] forced us to think about how to still create these communities we’re trying to build,” says Meryem Benslimane, equity education advisor at McGill University in Montreal. This year, the university took all of its Pride events online, including its recurring Tea for T event, which is normally a community dinner for transgender, two-spirit, non-binary and gender-questioning students, staff and faculty. In addition to holding the event online during Pride month, the university hosted a Tea for T on the International Day against Homophobia, Transphobia and Biphobia in May. Read: What employer participation in Pride means to employees “That gathering is so important and brings together students, staff and faculty, so [students] can see that there are staff and faculty who are trans,” says Benslimane. “And what we’ve seen is an amazing mentorship relationship between staff, faculty and the students.” With many of its employees working remotely before the pandemic, Ceridian HCM Inc. was already no stranger to hosting virtual Pride events. But this year was the first without an in-person component. “In the past,...

Staff  | June 30, 2020 While 67 per cent of Canadian plan members described their level of knowledge about a possible national pharmacare program as low or medium, 27 per cent said they don’t know anything at all about it, according to the 2020 Sanofi Canada health-care survey. Among plan sponsor respondents, 73 per cent described their level of knowledge as medium or low, with 13 per cent reporting not knowing anything at all about pharmacare. Employers with fewer than 50 employees were more likely (23 per cent) to have no knowledge. And just 14 per cent of all plan sponsors reported a high knowledge level. “If pharmacare were defined as the federal government taking on coverage for drugs for rare disease, you would have every employer and probably every insurer saying, ‘Let’s get that done.’ That’s a win for everyone,” said Chris Bonnett, a principal at H3 Consulting and an advisory board member. “As an industry, we can do more to tackle the tough first steps. We can’t wait on government. Plan sponsors should not be stuck in the middle, nor should patients.” Read: What are the implications of pharmacare reform for private drug plans? More than half (59 per cent) of plan members...

Staff | June 30, 2020 A new report by a U.K.-based think tank is suggesting public policy should shift to allow pension plan investments to help bolster the country’s infrastructure needs. The report, by the Social Market Foundation, urged the government to foster the growth of fewer, but larger, pensions funds, with the scale to make major infrastructure investments. “Learning from Australia and Canada, the U.K. should pursue a strategy of creating large ‘superfunds’ able to invest in large illiquid assets. Pension scheme charging rules should be reformed to allow funds of sufficient size to pay management fees for infrastructure investments.” Also looking to Canada’s system, the report said the U.K. should establish a project bond market where investors allocating towards infrastructure would sell bonds. Read: CPPIB issues Euro-denominated green bonds It also suggested that British politicians take on the role of actively shaping public opinion on the role of infrastructure and normalizing the idea of these projects making a profit. “Stronger arguments for the local benefit of infrastructure — and a public willingness to take on local doubts — would help allay investors’ concerns about risk. Ministers should also explain why private profit from public infrastructure is not a flaw of policy but a necessary condition...

Jim Bronskill, The Canadian Press | June 29, 2020 The Supreme Court of Canada has cleared the way for Uber drivers to take the next step in their fight to be recognized as employees. In a ruling Friday, the high court upheld an Ontario Court of Appeal decision that opened the door to a possible class-action suit aimed at securing a minimum wage, vacation pay and other benefits for drivers. The man behind the planned class action, David Heller, is a Toronto driver for UberEats, a service that delivers food from restaurants to customers at home. He argues that Uber drivers are employees, which entitles them to protections under Ontario’s Employment Standards Act. Read: Uber Black drivers fight for unionization at labour board hearing Uber, a global company that operates in more than 600 cities, has been present in Ontario for eight years. To become an Uber driver, Heller had to accept the terms of the firm’s standard services agreement. Ontario’s highest court said a clause in the agreement that requires all disputes to go through arbitration in the Netherlands was an unfair bargain and amounted to contracting out of an employment standard. Heller earns about $400 to $600 a week before paying taxes and expenses,...

COLUMBUS, Ohio – On July 1, Nationwide makes history by completing its 18-month transition to operate as a fully independent agency carrier. More than 99% of the company’s formerly captive agents will transition to Nationwide’s independent agency channel and continue partnering with the company. Since the company made the announcement to transition to a fully independent model in 2018, new written premium driven by independent agents has increased 35%. Nationwide boasts more than 11,000 independent agents across the country that sell personal lines, commercial lines, agribusiness, excess and surplus and financial services solutions. Nationwide has worked with independent agents since 1929. This transition comes at a critical time for independent agents. According to a recent Nationwide Agent Authority survey, independent agents say that their biggest challenges are driving new business to keep their agency strong for the future (69%) and maintaining their portfolio of clients due to the economic impact of COVID-19 (62%). “Despite the challenges associated with the COVID-19 crisis, we’ve made tremendous progress in transforming our business to meet the needs of independent agents and set our former exclusive agents up for success within the independent agent model,” said Mark Berven, President & COO, Nationwide Property and Casualty....

Staff | June 29, 2020 More than a third (40 per cent) of pre-retirees have a negative outlook on their life in retirement, the highest rates of negative retirement perception among survey respondents since 2014, according to the latest annual survey by Fidelity Investments Canada. The same percentage said their salary or earnings have decreased due to the coronavirus pandemic. Among those negatively impacted, 50 per cent are reducing the amount of money they’re able to save and the amount they’re able to invest, compared to last year. Read: Could coronavirus delay DC plan members’ expected retirements? However, the survey, which polled nearly 2,000 Canadians aged 45 or above, also found 80 per cent of pre-retirees and 92 per cent of retirees with a written financial plan said they feel positive about their future life in retirement. “Data shows Canadians near and in retirement are more negatively impacted by COVID-19 than the [2008/09] financial crisis,” said Peter Bowen, vice-president of tax and retirement research at Fidelity Investments, in a press release. “However, we are in this together and there is help. By seeking financial advice and writing down an action plan, Canadians can feel better and navigate the uncertainty.” Read: The impact of coronavirus on...

Quadient Customer Journey Explorer enhances the award-winning Quadient Inspire platform to strengthen customer experience capabilities Milford, CT (June 25, 2020) – Quadient, a leader in helping businesses create meaningful customer connections through digital and physical channels, is pleased to announce it has partnered with Kitewheel, a Leader in The Forrester Wave™: Journey Orchestration Platforms Q2 2020, to offer an enriched solution for managing the most important steps and interactions within a customer’s journey. The new solution, Quadient Customer Journey Explorer, developed by Quadient’s Customer Experience Management team, provides unified management of vital customer communication touchpoints, making it possible to understand, measure and optimize each journey to increase customer acquisition, satisfaction and retention. Customer Journey Explorer uses the elements of customer journey mapping, customer journey analytics and customer journey orchestration to manage a journey that connects to critical channels, offers insights into individualized experiences and empowers organizations with a richer profile of what customers want and need. Having the ability to understand and anticipate what customers are looking for brings action to journey maps, enabling real-time decisions to be made and providing customers with personalized communications that enrich the customer experience. “To ensure customer satisfaction and loyalty, organizations must have the...

As the COVID-19 crisis evolves, it will continue to affect insurance distribution around the world. Insurers can prepare by building a strategy focused on near- and long-term implications. By Simon Kaesler, Matt Leo, Shannon Varney, and Kaitlyn Young → Read the whole report Chicago, IL (June 12, 2020) – The COVID-19 pandemic is profoundly affecting how people engage with one another across industries and geographies. Physical distancing and other quarantine measures have shifted activities once considered critical to have in person to digital and remote channels. This change will affect insurance distribution—both in the near term, as physical distancing measures continue, and in the longer term. Indeed, society’s relationship with technology and remote interactions is continuously evolving and accelerating as we move toward the “next normal.” Many insurance companies have likely already taken steps to address short-term or immediate impacts of COVID-19—moving employees to a remote setup and expanding online customer service channels. Now, insurers are focused on the next set of challenges, including how to reimagine distribution in a more remote world. An April 2020 survey of German insurance agents (conducted four weeks into lockdown) found that about half of the agents saw a more than 40 percent decrease...